Saturday, January 14, 2017

Marc Faber : Strong Dollar Is a symptom that Global Liquidity is tightening

Marc Faber : Well first off all I am not interested what most
people think because most people thought that Britain would reject
Brexit and most people believed that Hillary would be elected in the US.
I am not particularly interested in what the majority thinks. But I
would like to say that when the market embarked on bull market in 1991,
interest rates say on treasuries were still around 8-9% and we had a big
correction in 1987 whereby the valuations of stocks in 1990 were not
particularly high. Valuations of US stocks today are very high.

Also
in the 1980s, do not forget the US market had significantly
underperformed emerging economies in particularly Japan. The Japanese
markets was the story of the 1980s. By early 1990s, the market in the US
was relatively inexpensive compared to stock markets overseas but this
is not the case at the present time.

If you look at that figures
or charts that go back 30 years. the US market has never been this
expensive compared to other markets in the world then it is now and I
believe whether you are contrarian or not, eventually there is a
reversion to the mean.

I believe the stock market in the US will
either go down more than emerging markets because we are in a global
bear market or emerging economies stock markets will go up more than the
US if the super bulls are right. But we have very strong headwinds.

One
of the headwinds is obviously if the economy strengthens a lot, I think
that consumer price inflationary pressures will come up and that
interest rates will go up. Once the 10 years yield goes to around 3%,
the stock market will notice and those stocks will face this headwind of
rising interest rates.

Secondly, do not forget if the US dollar
is strong, it means that foreign earnings of American companies are
translated into dollars in the US and so the earnings of multinationals
will suffer. Also, if the US dollar is very strong , it is a symptom
that global liquidity is tightening and when the dollar is very strong,
usually stocks do not perform particularly well. - in Economic Times

Marc Faber is an international investor known for his uncanny predictions of the stock market and futures markets around the world.Dr. Doom also trades currencies and commodity futures like Gold and Oil.

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Marc Faber is an international investor known for his uncanny predictions of the stock market and futures markets around the world.Dr. Doom also trades currencies and commodity futures like Gold and Oil.

Dr. Marc Faber joins Alex Jones live via Skype to expose how contemporary politics aim to use white people as a generic group to blame f...

Dr Faber studied economics at the University of Zurich and, at the age of 24, obtained a PhD in economics. He publishes a widely read monthly investment newsletter The Gloom, Boom & Doom Report, which highlights unusual investment opportunities, and is the author of several books, including Tomorrow’s Gold – Asia’s Age of Discovery which was first published in 2002 and highlights future investment opportunities around the world. Tomorrow’s Gold was for several weeks on Amazon’s bestseller list and has been translated into Japanese, Korean, Thai and German. A regular speaker at various investment seminars, Dr Faber is well known for his contrarian investment approach. He is also associated with a variety of funds.

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Dr. Marc Faber Short Bio

Who is Marc Faber author of the Gloom, Boom and Doom report is a world class Investor, Doctor Faber 's typically controversial and contrarian views have earned him the label of Dr. Doom. Doctor Doom also trades currencies and commodity futures like Gold Natural Gas and Crude Oil.Even his harshest critics must admit that he's been unerringly correct in his market forecasts over the past three decades . Marc Faber is a Swiss investor.He was born in Zurich, Switzerland. He went to school in Geneva and Zurich and finished high school with the Matura. He studied Economics at the University of Zurich and, at the age of 24, obtained a PhD in Economics magna cum laude. Between 1970 and 1978, Dr Faber worked for White Weld & Company Limited in New York, Zurich and Hong Kong. Since 1973, he has lived in Hong Kong. From 1978 to February 1990, he was the Managing Director of Drexel Burnham Lambert (HK) Ltd. In June 1990, he set up his own business, which acts as an investment advisor and fund manager. Faber is publisher of the Gloom Boom & Doom Report newsletter and is the director of Marc Faber Ltd which acts as an investment advisor and fund manager.